After nearly 25 years of wrestling with Saddam Hussein, Iran’s Shiite rulers have the war to thank for their newfound power.

Illustration by Edel Rodriguez for FPThe new Iraq was supposed to be a model for the Middle East and a threat to Iran’s theocracy. Instead, Iran has emerged as the biggest winner of the United States’ war. There is little stability or democracy in Iraq to impress Iranians. Conjuring more fear than hope, the war did nothing to loosen the grip of clerical rule over the country. Iranians rejoiced in the fall of Saddam, who fought an eight-year war against their country that killed hundreds of thousands of people, many by chemical weapons. For Iran, the war in Iraq turned out to be a strategic windfall, uprooting Baathism and pacifying a nemesis that had been a thorn in its side for much of the 20th century. Iraq’s new Shiite—and in good measure, Kurdish—masters enjoy friendly ties with Iran. It was no coincidence that Iran was the first of Iraq’s neighbors to recognize its new government and to encourage Iraqis to participate in the political process introduced by the United States.

In the political vacuum that followed Saddam’s fall, Iranian influence quickly spread into southern Iraq on the back of commercial connections—driven by a growing volume of trade and a massive flow of Iranian pilgrims into shrine cities of Iraq—and burgeoning intelligence and political ties. Iran’s influence quickly extended to every level of Iraq’s bureaucracy, Shiite clerical and tribal establishments, and security and political apparatuses. The war turned a large part of Iraq into an Iranian sphere of influence, and equally important, paved the way for Iranian hegemony in the Persian Gulf. With the Iraqi Army gone, there is no military bulwark in the Persian Gulf to contain Iran’s expansionist ambitions.

Iraq also changed the context for U.S.-Iran relations. The Bush administration, having named Iran as part of an “Axis of Evil,” categorically ruled out dealing with it—even after the two countries successfully collaborated over the fate of Afghanistan after the fall of the Taliban in 2001. Regime change in Tehran was Washington’s mantra in 2002. Yet, since the war in Iraq began four years ago, Washington has balked at seriously engaging Iran—despite the impasse over the nuclear issue, Iran’s support for Hezbollah and Hamas, and virulent attacks against Israel. Instead, the United States has decided that the path to regional stability lies in confrontation and rolling back Iran’s regional influence. However, growing anti-Americanism in the Arab world, combined with the expanding U.S. military commitment to Iraq, will make it difficult for Washington to contain Iran easily. In short, Iraq has strengthened Iran and weakened the United States.

Still, Iran’s gains are matched by new challenges. Tehran may no longer have much to fear from those who rule Baghdad, but the chaos brewing within Iraq’s borders makes Iranian rulers nervous. A failed Iraq—or worse, a warring Iraq infested with radical ideologies and ruled by violent militias—threatens Iran’s stability. Kurdish autonomy or independence could disturb Iran’s own delicate Kurdish situation. Arab capitals are abuzz with talk of the Iranian threat, raising the specter of an anti-Iranian regional alignment. The war in Iraq has turned Iran into the bugbear of the region. But that is ultimately a price Iran is willing to pay for winning in Iraq.

Illustration by Edel Rodriguez for FPThe badly lit, helter-skelter video of Saddam Hussein’s execution said it all: “Moqtada! Moqtada! Moqtada!” a voice cried as the hangmen tightened the noose around Saddam’s neck. Seconds later, the deposed dictator dropped through the floor.

Four years into the American occupation of Iraq, tens of thousands of people are dead and a nation is imploding. And Moqtada al-Sadr, the young, rabble-rousing cleric few people had even heard of when the invasion began, can now plausibly claim to be the most powerful man in the country. Sadr’s power covers the whole spectrum of political possibility: He commands as many allies in the Iraqi Parliament as any single party; and his armed followers permeate Iraq’s security forces, control the streets throughout eastern Baghdad and the Shiite south, and fill the ranks of many of the death squads that terrorize the country’s Sunni minority. The Americans would like to see Moqtada off the scene; many moderate Shiite leaders would like to see him dead. Yet Sadr, still in his 30s, appears unassailable. Indeed, he seems the person most likely to benefit should Iraq sink further into chaos.

Sadr’s rise was less a determined climb than a bubbling up. He ascended on the hopes of his supporters, the millions of downtrodden Shiites who had once looked to his father, Ayatollah Muhammad Sadiq al-Sadr, a scholar and cleric who, along with two other sons, was murdered by Saddam’s gunmen in 1999. The surviving Sadr does not have his father’s learning; at times he seems to be riding his movement rather than directing it. But like any born demagogue, Sadr possesses an uncanny sense of timing.

In 2003 and 2004, Sadr capitalized on the growing disenchantment with the American occupation—and the growing ferocity of the Sunni insurgency, which the Americans were unable to stop. On any Friday afternoon, you can go to the open-air Al Mohsen Mosque in Sadr City and watch 25,000 men kneel in the street and chant “Moqtada! Moqtada! Moqtada!” It’s an unsettling thing to witness, a demonstration of where power in the new Iraq really resides.

I saw him just once, and only for a second. It was August 2004 in Najaf. For weeks, Sadr’s men had occupied the Imam Ali shrine, one of the holiest of Shiite sites, and the Americans, with the tacit blessing of Ayatollah Ali al-Sistani and the mainstream Shiite religious leadership, had fought their way into the city to force Sadr’s Mahdi Army out of the shrine. The Americans killed hundreds of them, leaving it to the moderate clerics around Sistani to broker a cease-fire. Late one evening, the clerics summoned a group of reporters to a nearby house to listen to their announcement. I was late in arriving, and as I approached, in the corner of my eye, I saw Moqtada scuttling out a side door. What an image: The young rebel who made so much trouble slipped out as the adults cleaned up his mess.

It’s a measure of how much Iraq has changed since then that it is impossible to imagine anything like that happening now. Sadr is more powerful than any of the clerics who put up with him two years ago. Next time, he won’t be going out the side door; the stage is now his.

The terrorist network was on life support after September 11—until a new front opened in Baghdad and revived its mission.

Illustration by Edel Rodriguez for FP“The Americans are between two fires,” declared Osama bin Laden’s deputy Ayman al-Zawahiri in 2004. “If they remain [in Iraq] they will bleed to death, and if they withdraw they will have lost everything.” Zawahiri’s grim prediction has proven correct. As the United States and its Iraqi allies falter, bin Laden and the broader jihadist movement are emerging victorious.

Before the United States invaded Iraq, al Qaeda was on the ropes. The United States and its coalition partners had rousted it from Afghanistan and toppled the Taliban, while a global manhunt was steadily shutting down jihadist cells from Morocco to Malaysia. Perhaps equally important, many Islamists, including fellow jihadists, harshly criticized bin Laden for having rashly attacked a superpower and, in doing so, causing the defeat of the Taliban, the only “true” Islamic regime in the eyes of many radicals.

Then the invasion of Iraq breathed new life into the organization. On an operational level, the United States chose to divert troops to Iraq rather than consolidate its victory in Afghanistan and increase its chances of hunting down bin Laden. Today, al Qaeda is reconstituting itself in the tribal areas of Pakistan. Politically, Iraq vindicated bin Laden’s argument that the primary enemy of the Muslim world was not the local Muslim autocrats, but the “faraway enemy,” the United States.

The Iraq invasion has inspired a new generation of young Muslims around the world. The war outraged Muslim militants, many of whom embrace bin Laden’s form of violence. Iraq itself witnessed the most dramatic revival. Saddam had crushed the jihadists in Iraq with his iron fisted rule, but today the country is full of them, with foreign fighters increasingly playing second fiddle to domestic jihadists.

Those jihadists who come to Iraq are forming a network similar to the one formed in Afghanistan during the anti-Soviet struggle. Some will die there, but not enough, not all of them. Many will survive and return to their home countries with increased fervor, a more coherent ideology, and a Rolodex filled with contacts. These fighters will not necessarily be under bin Laden’s control, but they will be part of the broader movement that bin Laden has now succeeded in fostering.

The jihadists are also becoming far more lethal. The improvised explosive devices used in Iraq are of increasing sophistication and will be used in other jihads, whether in Kashmir, Chechnya, or Somalia. So, too, is suicide bombing, which has now become such a common tactic that it no longer draws gasps. Already (and with painful irony), these techniques are regularly showing up in Afghanistan.

Withdrawal carries its own dangers for counter terrorism. Though the United States may leave, many jihadists will stay in Iraq to fight Iraqi foes. The anti-American struggle is widely popular, and jihadist propaganda is creatively stressing their role in undermining the U.S. campaign. The credibility of these fighters will embolden the movement, convincing them that the United States and other foes can be defeated, if only Muslims will continue the fight.

Perhaps most ominously, parts of Iraq might become a new safe haven for the movement. Jihadists based in western Iraq launched the bloody 2005 attacks in Jordan that killed 60 people. Similar attacks are likely as Iraq goes from jihadist front line to a base for the next struggle

The Middle East’s strongmen were under pressure to reform. Now, they rest easy.

KHALED AL FIQI/AFP/Getty Images The failure of U.S. policy in Iraq has provided autocratic regimes in the Middle East a reprieve from the pressure to democratize, as long as they position themselves clearly on the side of Washington in its looming confrontation with Iran, Syria, and Shiite Islamists. Saudi Arabia and Egypt have been the biggest beneficiaries of the U.S. loss of interest in draining the swamp of autocracy once it was confronted by large alligators such as Iran and its allies. Once again, autocracy is thriving—and so are the alligators.

Saudi Arabia has historically been a reliable U.S. partner, trading cheap oil for American protection. Egypt, kept at arm’s length during the Nasser years, became a staunch ally after President Anwar Sadat went to Jerusalem and then signed the Camp David Accords with Israel in 1978. The pro-Western stance of Egypt and Saudi Arabia protected them from criticism, until the attacks of Sept. 11, 2001, that is. Almost overnight, the two countries became U.S. enemies, accused of fostering terrorism by denying their citizens democracy and wealth-generating free market policies. Authoritarianism and bad economic policy, according to Washington’s new creed, engendered frustrations that found release in terrorism. The antidote was democracy.

For a few years, Egypt and Saudi Arabia thus found themselves in the unaccustomed and uncomfortable position of being lectured on democracy by U.S. officials. Egypt bore the brunt of the criticism because it was obvious what reforms the government needed to introduce to become more democratic. Egyptian officials were repeatedly lectured on competitive elections and constitutional amendments; most seriously, the United States postponed discussion of a free trade agreement after the Egyptian government sentenced a moderate opposition leader to a five-year prison term on charges that were flimsy at best. Saudi Arabia got off more easily, partly because nobody had a blueprint on how to transform that kingdom into a democracy, and partly because of America’s dependency on its oil. Nevertheless, the country fell under a pall of suspicion, accused of financing the spread of radical Islam and even terrorist groups. Never again, administration officials and pundits proclaimed, would the United States support authoritarian regimes for the sake of short-run stability. September 11 put an end to that policy. Well, at least for a few years.

As the United States has become mired in bloody chaos in Iraq, Saudi Arabia and Egypt have wound up back in the Bush administration’s good graces. But it’s not because they’ve become more democratic. Saudi Arabia has not changed. The Egyptian regime is backsliding, becoming increasingly intolerant of dissent as it nears the inevitable end of the 25-year rule of President Hosni Mubarak and braces for a difficult succession. Nevertheless, the two countries have been rehabilitated, or at least relabeled: Sadly, they are now what passes for “moderate.” As Franklin D. Roosevelt might have put it in more frank language, they are still the same S.O.B.s, but they are once again “our S.O.B.s.”

It’s back to Cold War politics in the Middle East. The lofty ideals of democracy promotion may still find their way into the administration’s speeches, but when it comes to policy, America’s enemies’ enemies are its friends. The enemy is Iran and, like the Soviet Union of yore, Iran has surrounded itself with dangerous minions—Hamas, Hezbollah, and Syria. Iran wants to dominate the region, and Washington will support countries that have an interest in resisting such domination. Saudi Arabia and Egypt can be counted upon to do so. That makes them “moderates,” and that is good enough.

But Egypt and Saudi Arabia are paying a high price for this reprieve from Washington’s pro-democracy zeal. They must contend with an Iran no longer constrained by Iraqi power, with a Shiite revival, with the collapse of Iraq, with a Lebanon that may descend into chaos, and with a Palestine that already has. It is far from clear whether Egypt and Saudi Arabia would not happily trade the problems brought about by the destabilization of the region for renewed pressure to reform. But now, they don’t have a choice.